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Blababa [14]
3 years ago
11

Company X currently has a capital structure that consists of 40% equity, 20% preferred equity, and 40% of debt. The risk-free ra

te is 3% and the market risk premium is 8%. The company's equity beta is 1.1. The dividend yield for the preferred equity is 6%. The corporate tax rate is 21%, and the cost of borrowing for company X is 5%. What is the WACC for company X
Business
1 answer:
Sindrei [870]3 years ago
8 0

Answer:

14.58%

Explanation:

WACC = weight of equity x cost of equity + weight of debt x cost of debt x (1 - tax rate) + weight of preferred equity x dividend yield

According to the capital asset price model: Expected rate of return = risk free + beta x (market rate of return - risk free rate of return)

r= 3% + 1.1 x 8 = 11.8

equity = 0.4 x 11.8% = 4.72

d = 0.4 x 5 x (1 -0.21) = 1.58

p = 0.2 x 6 =  1.2

11.8 + 1.58 + 1.2 =

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Answer:

Find attached complete question:

The correct option is A,$ 746,200

Explanation:

The total standard costs for the whole items of inventory completed in the month of July is the sum of the beginning balance of inventory plus direct materials costs, direct labor cost as well as manufacturing overhead cost applied.

Total cost of completed units=$44,100+$564,900+$195,300+$315,000=$ 1,119,300.00  

standard cost per unit=$1,119,300.00/21000=$53.3

Cost of goods sold(unadjusted)=$53.3 *14,000=$ 746,200.00  

6 0
4 years ago
In applying fiscal policy Conservatives will normally seek to limit government and will be inclined to ________ taxes (T) during
telo118 [61]

Answer:

Decrease

Explanation:

Fiscal policy is an important policy tool which is used by the government to account for revenue and expenses. During a boom stage, when the economy is improving the government implements more taxes. Similarly, in a recession period, where economic growth is negative an expansionary discretionary fiscal policy is applied. In this type of fiscal policy, taxes and government expenses both are concentrated to remove the pressure.

8 0
4 years ago
Give two examples where it would be best to use email. Give two examples where it would be best to speak to some one face to fac
dusya [7]

Answer:

email: if it isnt in a serious situation or if nothing needs to be confronted to whoever.

face to face is a situation thatmight be serouse or would just have a hard time explaining in email.

ex. email: when you need to send work through the internet.

ex. face to face: needing to talk personally to someone.

8 0
3 years ago
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An entrepreneur establishes a social justice online retail company. The company purchases authentic artwork, jewelry and crafts
Greeley [361]

Answer:

a. Developing a robust marketing program to promote the social justice elements of the business and gain insights into consumer purchasing behavior on the website

Explanation:

In order to sustain the business, the entrepreneur should create a robust marketing program in which he is able to promote the components of social justice and also the behavior of the consumer on the website so that he gets to know how much people are active in his website, what are the problem people are facing, etc

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3 0
3 years ago
Problem 2-15 (Algorithmic) Life Insurance (LO 2.8) Sharon transfers to Russ a life insurance policy with a cash surrender value
skelet666 [1.2K]

Answer:

$38,440

Explanation:

Calculation to determine How much of the proceeds, if any, is taxable to Russ

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Less: Cash Surrender value ($24,800)

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Taxable Proceeds $38,440

Therefore the taxable Proceeds are $38,440.

6 0
3 years ago
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